NEW YORK SUPREME COURT – QUEENS COUNTY

FCDB NCPL 2008-1 TRUST,
Plaintiff,

-against-

IVAN PELAEZ, MARIA ESPINOZA a/k/a
MARIA ANGELA ESPINOZA, DISCOVER BANK,
NEW YORK STATE DEPARTMENT OF
TAXATION AND FINANCE, NEW YORK
CITY ENVIRONMENTAL CONTROL BOARD,
“JOHN DOE #1″ through “JOHN DOE #12″, the last twelve
names being fictitious and unknown to plaintiff, the persons
or parties intended being the tenants, occupants, persons
or corporations, if any, having or claiming an interest,
in or lien upon the premises being foreclosed, herein,
Defendants,

EXCERPT:

With respect to the claim by defendants Ivan Pelaez and Maria Espinoza that plaintiff lacks
standing to bring this action, “ ‘[e]ntitlement to a judgment of foreclosure may be established, as a
matter of law, where a mortgagee produces both the mortgage and unpaid note, together with
evidence of the mortgagor’s default, thereby shifting the burden to the mortgagor to demonstrate,
through both competent and admissible evidence, any defense which could raise a question of fact’ ”
(Zanfini v Chandler, 79 AD3d 1031, 1031–1032 [2d Dept 2010], quoting HSBC Bank USA v Merrill,
37 AD3d 899, 900 [3d Dept 2007]; see U.S. Bank, Nat. Assn. v Sharif, 89 AD3d 723 [2d Dept
2011]). Foreclosure of a mortgage, however, may not be brought by one who has no title to it (see
Kluge v Fugazy, 145 AD2d 537, 538 [2d Dept 1988]). Where standing is raised as a defense by the
defendant, the plaintiff is required to prove its standing before it may be determined whether the
plaintiff is entitled to relief (see U.S. Bank, N.A. v Collymore, 68 AD3d 752, 753 [2d Dept 2009];
Wells Fargo Bank Minn., N.A. v Mastropaolo, 42 AD3d 239, 242 [2d Dept 2007]).

Plaintiff, in bringing this action, relies upon an assignment dated June 16, 2011 whereby
Mortgage Electronic Registration Systems, Inc. (MERS), as the nominee for New York Mortgage
Company, LLC purportedly assigned the mortgage, together with note to plaintiff. New York
Mortgage Company, LLC is not a party to the assignment, and the mortgage itself does not
specifically give MERS the right, as the nominee or agent of New York Mortgage Company, LLC,
to assign the underlying note (see Bank of N.Y. v Silverberg, 86 AD3d 274, 279 [2d Dept 2011];
Aurora Loan Servs., LLC v Weisblum, 85 AD3d 95, 108 [2d Dept 2011]). Nor has plaintiff shown
that MERS had been given an interest in the underlying note by the lender (see Bank of N.Y. v
Silverberg, 86 AD3d at 283). Insofar as plaintiff also relies upon the physical possession of the
original note by its agent at the time of the commencement of the action (see e.g. U.S. Bank Natl.
Assn. v Cange, 96 AD3d 825, 827 [2d Dept 2012]), the note is made payable to New York Mortgage
Company, LLC and has an allonge with an endorsement by Laurel A. Garvey, as “Director,
Operations (Wholesale)” of New York Mortgage Company, LLC to American Home Mortgage
Corp., without recourse, and another blank endorsement, without recourse, by Jodi Lynch, as
assistant secretary for American Home Mortgage Corp. The affidavit of Lynne Roberto does not
indicate when the blank endorsement on the allonge was executed. The affirmation of plaintiff’s
counsel likewise does not address the issue. Plaintiff additionally has failed to establish that the
allonge is “so firmly affixed” to the note “as to become part thereof” (UCC 3-202[2]; Slutsky v
Blooming Grove Inn, 147 AD2d 208 [1989]). Under such circumstances, that branch of the motion
by plaintiff for summary judgment against defendants Ivan Pelaez and Maria Espinoza is denied (see
Winegrad v New York Univ. Med. Ctr., 64 NY2d 851; see Deutsche Bank Nat. Trust Co. v Haller,
100 AD3d 680, 682 [2d Dept 2012]).

That branch of the motion by defendants Ivan Pelaez and Maria Espinoza to dismiss the
complaint insofar as asserted against them is denied. Questions of fact exist as to when the allonge
was endorsed in blank and whether it is firmly affixed to the note (see Deutsche Bank Nat. Trust Co.
v Haller, 100 AD3d at 683; Deutsche Bank Natl. Trust Co. v Rivas, 95 AD3d 1061 [2d Dept 2012];
HSBC Bank USA v Hernandez, 92 AD3d 843, 844 [2d Dept 2012]). That branch of the motion by
plaintiff to dismiss the second affirmative defense asserted by defendants Ivan Pelaez and Maria
Espinoza based upon lack of standing is denied.

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